Drug Approval Reciprocity between the United States and Europe

February 25, 2014

Princeton University recently saw an outbreak of a meningitis strain not protected by the traditional meningitis vaccine. Drug manufacturer Novartis, however, had developed a vaccine -- Bexsero -- that the U.S. Food and Drug Administration (FDA) allowed Princeton to offer to its students. And after a similar outbreak at the University of California, Santa Barbara, the FDA also permitted the use of Bexsero, say Paul Howard and Yevgeniy Feyman, fellows at the Manhattan Institute.

But the drug has not been approved for use beyond these special instances in the United States, despite multiple clinical trials that illustrate its safety. Europe, Australia and Canada, however, have all approved the vaccine.

Howard and Feyman suggest a reciprocity system: if the FDA and the European Medicines Agency (EMA, the EU version of the FDA) have similar safety standards, reciprocal approval makes sense. Otherwise, manufactures are forced to "jump through the same hoops over and over," spending scarce funds to conduct duplicate trials of the same medicine.

So why has reciprocity never been seriously considered? Howard and Feyman suggest that $672 million in application review fees make a partnership with other countries' regulatory agencies less attractive for regulators. And if drug manufacturers could access the American market by obtaining approval from the EMA instead of the FDA, drug applications may exit the United States and head toward Europe.

Those opposed to reciprocity have also suggested that such a system would encourage a "race to the bottom," with regulating agencies cutting back regulations in order to attract more applications, but the authors disagree.

Reciprocity could be limited only to highly developed trading partners as well as to well-understood classes of drugs that have a seriously unmet need, such as cystic fibrosis or cancers. If companies apply for reciprocity and are rejected, the FDA or EMA would have to respond publicly, detailing the reasons for the rejection.

Tort law would still be in place, discouraging companies from cutting corners and producing shoddy drugs. And regulators would want to protect their own reputations for scrupulousness and scientific accuracy.

The AIDS crisis serves as an example of what reciprocity could bring. When patients began importing unapproved medicines into the United States in response to a dearth of approved drugs in America, the FDA was forced to change its regulations, accelerating access to medicines.

This type of regulatory competition would benefit consumers and the FDA and other agencies would be forced to compete with one another based on efficiency and rationality.